As new property owners, many investors plan their budgets, assuming that the rent will be on time to support consistent cash flow. This situation is wonderful when it's true, but rent nonpayment can stop that plan in its tracks. If you're struggling with on-time rent collection for one or more of your residents, our Glen Burnie property management team has a few tips to improve rent collection and reduce the risks of nonpayment. Your success as a real estate investor could depend on it!
Understanding the Consequences of Rent Nonpayment
You might think that a month or two with a late rental payment won't be a significant impact on your cash flow. However, the problems with late payments (or no payments at all) can trickle down into more issues than you might think!
First, even a small delay in receiving monthly rent payments makes you late on the bills for your rental properties. Suppose the rent is late and you don't have the cash flow to pay monthly expenses. You might have to cover it out of your savings or delay your payment. In that case, you may incur fees for a late mortgage payment and experience damage to your credit score. Your finances quickly become tied up in whether a renter pays their rent on time or not.
To get the renter back on track as soon as possible and rebuild your cash flow, property owners must enforce on-time rent collection and implement the consequences listed in the lease. When you have a reputation for permissiveness and renters don't want to pay, you may find yourself with multiple delinquent renters and a serious cash flow crunch.
What Does a Property Manager Do To Prevent Rent Nonpayment?
Glen Burnie property management companies recognize that every decision, from "how much can I rent my house for" to how the lease is worded, affect the likelihood that the rent will be paid each month. This is why the best rental property managers have solid procedures for screening applicants and identifying red flags specifically related to rent nonpayment.
Much of the work to prevent rent nonpayment happens before ever placing a renter in your property! For instance, property managers:
- Provide many easy-to-use ways to pay the rent. Online portals and apps, for example, also allow alerts to remind people that the rent is almost due, which can prompt someone to pay who might otherwise forget.
- Keep up with maintenance and communicate proactively. Showing they are active and attentive property managers is a strong motivator to encourage renters to pay on time. In addition, responding promptly to maintenance requests or other concerns shows renters that owners uphold their responsibilities—eliminating any reason a renter might have for withholding the rent.
- Follow up right away in the case of a missing payment. Reaching out promptly when the payment deadline comes and goes also helps renters realize that their rent nonpayment won't go unnoticed.
When answering the question "what does a property manager do," the right property management company recognizes patterns and puts processes in place to minimize the risk of rent nonpayment. They have enough experience to recognize warning signs that someone is likely to be an ongoing rent nonpayment concern versus a one-time occurrence due to an understandable issue paying rent. With that experience, they can respond appropriately to minimize the impact on your cash flow!
Protection for a Property Owner When Rent Isn't Paid
All that being said, even the best property manager will occasionally see a renter who doesn't pay the rent. So what does a property manager do in these situations? Luckily, the best property managers have a program in place to make sure property owners don't lose money—even when renters don't pay the rent!
One way that the Renters Warehouse BW Metro team passes on that comfort to our property owners is through our Guaranteed Rent Program. With our expert strategies and property management services, we improve on-time rent collection for real estate investors. However, if a renter fails to pay the rent on time, we pay you anyway!
Our program allows a property owner to count on cash flow that might otherwise be inconsistent if you didn't have our experts to handle rent collection or this guarantee. Renters Warehouse BW Metro works hard to keep your cash flow positive and reduce the risks of rent nonpayment.
Reduce Risks With Our Glen Burnie Property Management Company and Guaranteed Rent!
Working with Renters Warehouse BW Metro is more than just rent collection help! While you won't find our Guaranteed Rent Program with other Glen Burnie, MD, property managers, we deliver much more than consistent cash flow to support your success. Our full-service property management includes renter screening, marketing, maintenance, renter management, and more! We're here to partner with you to maximize your returns. Reach out soon, and let's talk more about how our property management professionals help reduce risks for real estate investors and how our Guaranteed Rent program works!